Digital Strategies for a Friction-Free Customer Experience: Q&A with Ryan Collier, Chief Digital Officer, RPS

Digital Transformation, Insurance Industry News & Views - October 20 2021

Ryan Collier is Chief Digital Officer and President of Executive Lines at Risk Placement Services, a leading Managing General Agent/Underwriting Manager and nationally focused wholesale insurance broker. RPS has ranked in the top five in every insurance industry category and have been consistently ranked as the largest MGA in the United States for several years. Recently RPS was named a 2021 top insurance workplace by Insurance Business America, with headquarters in Rolling Meadows, Illinois, the company has more than 500 employees, 80 branch office and satellite locations. We caught up with Ryan to discuss how digital transformation is impacting the commercial insurance market and his experience deploying digital strategies, tips for fostering a culture of innovation, removing friction from the risk placement process, and thriving in the wake of disruption.

Ryan, the term ‘digital transformation’ is a phrase that is broadly used across the insurance industry today. From your perspective, in your words, how would you define digital transformation?

To me, digital transformation is simply leaning on technology and data to enable the carriers and brokers to be better able to serve their customers. Historically, our industry has used opinion-based thinking and “gut feel” to solve problems and serve customers. Having an ecosystem that allows the entire lifespan of a client’s needs to be digitally accessible is quite a challenge and the goal that companies should strive for. Our people shouldn’t spend their valuable time on non-revenue/non-client facing tasks – they should be empowered by the tools that can be put in place whether that is on the risk taking or risk facilitation side.

We all know that large-scale digital transformations won’t happen overnight. How do you drive meaningful change, push innovation forward, and empower others within the organization to accept and embrace change?

We are definitely seeing that this change won’t happen overnight and in many cases over decades. The key is change management because humans intrinsically don’t like change and they really don’t like change that they feel threatens their livelihood. I have always defined the difference between digitization and digitalization to help give our employees more comfort that a true digital transformation will allow them to achieve much bigger and better goals than they could doing things the “old way.”

Digitization is the use of technology to remove humans from the equation. Think about depositing a check today – a person can take a picture of the check and deposit it without going to a bank and interacting with a teller. That is using technology to remove non-revenue generating tasks from the daily routine of an employee. With digitalization, I define that as using technology to enable the employee to be more efficient and effective at their job. Going back to that teller example above, by reducing the need for human intervention on basic transactions, it frees that individual to focus on other accretive positions such as counseling customers on personal finance, loans, retirement, positions which in turn benefits the customer, the employee, and the employer. Truly, a digital transformation should be a win-win-win for all parties. The customer has a positive experience, the employee develops a more lucrative career due to the value they bring to the bank, and the bank can become a more trusted advisor to their customer. This has become even more evident in today’s low unemployment environment where the number one threat to every business is the war for talent.

The global insurance industry continues to experience disruption due to various market factors (the pandemic, a hardening market, new risks, etc.). Which factors do you feel are having the biggest impact on executive lines today?

All of the above. Personally, I never thought we would see a firming market such as we are now due to the use of data, algorithms, and technology but here we are. The professional and executive lines industry face many challenges, but most notably there is a severe shortage of talented workers to satisfy the demand. Additionally, those workers that are in the industry have changed jobs at a brisker pace than I have seen during my 25 years in the industry. That is leading to significant wage inflation and driving up the cost of doing business for insurance carriers and brokers alike. Add in social inflation for claims, some exceptionally litigious geographic areas, a new cyber threat virtually every hour and you have a recipe for a difficult marketplace. With regard to cyber insurance, cyber-attacks and more specifically ransomware have become a multi-billion-dollar business with very few obstacles to slow these bad actors down. The cyber criminals have a huge head start over corporate cyber defenses, so I don’t foresee this slowing down any time soon.

We recently published our second annual crowdsourced eBook Underwriting Priorities 2021 & Beyond. How is underwriting evolving, and which technologies and digitization initiatives should carriers focus on to make their underwriting processes more efficient, profitable, and responsive to customers?

Underwriting is evolving through the use of data and technology. I really feel that creating a friction-free buying process is critical for success. Historically, the industry has catered to underwriters and their need to quantify and qualify a risk, but, today, the focus needs to shift toward the customer. In today’s world of instant gratification, no insurance buyer wants to spend three to ten hours completing applications for insurance. Nearly 99% of businesses in the United States have fewer than 100 employees so why not use third party data to truncate that application process and give the customer a great user experience? In addition to completing the underwriting applications, technology can be used to let the customer know how likely a claim will be for each policy, the potential claim amount, and how best to prevent these possible claims scenarios from occurring. There is so much opportunity for the industry to improve on the customer experience over the coming years.

A recently published RPS State of the Cyber Market: 2021 2nd Quarter Update report states that, “perhaps the most concerning trend we are seeing is significant restrictions on available capacity. Cyber insurers are implementing aggressive de-risking strategies in an effort to reduce their exposure to catastrophic loss.” Beyond capacity, what are the greatest cybersecurity concerns that carriers, brokers, and MGAs should consider when planning for the needs of their customers?

I still believe the great concern is that of education. I know it sounds extremely basic, but there are still very few people in our industry that truly understand cyber insurance. Education needs to occur at the insured level, the broker level, the underwriter level, and the reinsurer level. It is a nascent insurance product, which is why so much education is needed.

Risk managers and CIOs need to understand that their hubris and wishful thinking won’t keep the cyber criminals out of their networks. Fifty years ago, buildings didn’t have sprinkler systems to prevent fires, but the technology evolved, and the industry became more educated and aware to the point that sprinklers are commonplace. Preventing cyber-attacks is hard – these cyber criminals are brilliant and fiercely committed to compromising a company and their systems during every waking moment, yet the targets of those attacks think they can spend a few hours a week to keep them out.

Brokers need to become more proficient in this space and understand who the great vendors are to help their clients. The role of the broker has never been more important to help assist their customers stay viable.

Finally, underwriters need to continue their education as there aren’t many people in this niche that honestly can tell what the next three years will bring. There is no silver bullet to perfectly predict or avoid claims right now, hence why we are seeing a massive de-risking of portfolios.

Beyond cyber risk, what new risk exposures are emerging and what are the implications of these risks on executive lines like D&O, E&O, and others?

I am curious what impact Covid will ultimately have on the Employment Practice Liability (EPL) space. This recent government-enacted vaccination mandate could bring tremendous risk to that market. There is no precedent for what has been done by the government so that is a giant risk to navigate until the pandemic ends. What about those nurses that literally worked in a combat zone throughout the entirety of the pandemic that are being fired for not being vaccinated? Do they have a wrongful termination claim? We will see. How about the pharmacies that are being forced to close because the pharmacists were terminated for failure to get a vaccination? How does that affect their business financially as well as legally? That might lead to a bankruptcy and therefore a D&O claim.

There’s lots of hype in the market about SPACs – it’s one of the hottest trends on Wall Street. In fact, roughly 200 SPACs went public in 2020 and the trend is continuing in 2021. What impact do SPACs have on executive lines like D&O? And how are brokers and agents placing D&O insurance coverage impacted?

These are very tough placements that require true expertise. I have always said that D&O shouldn’t be placed by pretenders and that couldn’t be truer when it comes to SPACs. This could lead to potential E&O on the part of the broker if the placement wasn’t done correctly. The premium and retention are extremely high by historical standards and that is because of the risk factors inherent in these placements.

If we take cost out of the equation, what factors should insurance companies consider when deciding to partner with technology providers or insurtechs vs. building digital capabilities in-house?

In my opinion, it all comes down to distribution. I have often said it is up to the incumbents to find innovation before the innovators find distribution – that is the current race. I don’t think brokers or clients are looking for yet another carrier portal in order to procure coverage – they are looking for a marketplace to service their clients efficiently and that isn’t done by entering and re-entering information in 12 disparate portals.

Insurance companies should find distribution partners that have established a deep distribution network across all geographies and that also utilize a strong technology platform, and fuel those partners with great products that are relevant to the customer they want to attract.

There have been several articles published on the importance of culture in insurance innovation. What role do you feel culture plays in driving digital transformation within an organization?

It is possibly the most critical aspect. Change management is a skill that few organizations have mastered. As those articles will attest, a company with a strong, adaptive digital culture has a far greater chance of successfully transforming and continually growing than one whose culture resists change. To really do business differently it requires a commitment and vision from leadership. Bold leadership done right inspires and builds trust. When people trust leadership and believe in the vision, they will lean into change rather than fight it.

In your opinion, what are the top three things that every insurance organization should be doing today to deliver a better customer experience and how can the cloud, AI, and other emerging technologies enable these priorities?

To build off the prior question, I think the first aspect to focus on is building a strong digital culture. Hand-in-hand with this is finding the right people not just for change, but that are smart and adaptable enough to facilitate the great customer experience. A relentless focus on the customer experience doesn’t come naturally to the insurance industry. Once the right people are in place and the right culture is formed then the blocking and tackling can begin. If these first two pieces aren’t right, there is a very small chance of success to build a truly great CX. Since you have asked for the top three things, I’ll add that data and the proper use of that data is critical, as well.

So, to summarize, the top three considerations are:

  1. Build a strong digital culture
  2. Identify smart and adaptable people
  3. The proper use of data

Take out your crystal ball: As the role of Managing General Agents (MGAs) and Managing General Underwriters (MGUs) continues to evolve, what’s next in the evolution of the MGA/MGU model?

I feel that it is entirely possible to be able to offer a complete one-stop shop for the entire risk management needs of a business through a technological platform. This platform will not only streamline the procurement process for the insured down to mere minutes but will give great insight into the tools that are needed to assess the risks that customer has. Imagine entering a few pieces of information about a customer and having a platform utilize many tools behind the curtain to assess the products that the customer should buy, the likelihood of each product to have a claim during the near future, and the quantification of the risk exposure for that customer. It will happen and when it does, that firm will have a huge competitive advantage.

Ruddy RPS 2_20180028a_HRRyan Collier is Chief Digital Officer and President of Executive Lines at Risk Placement Services. As the Chief Digital Officer for Risk Placement Services [RPS], Ryan Collier leads an innovative insurance team focused on transforming the way insurance business gets done. In 2016, Collier and his team launched cyber liability insurance on RPS’ quote-bind-issue platform by distilling a 15-page, 100-question application down to four simple questions that can be completed in less than a minute online.

The RPS e-commerce team has followed this template to launch 23 additional products, most of which can be quoted, bound and issued online in approximately 90 seconds. The platform achieved a major milestone in 2021 with the 100,000th policy bound on the site. The platform has now generated over $300 million of premium from more than 63,000 retail insurance agents.

In his dual role as the President of the Executive Lines division, Collier has guided an energetic, entrepreneurial team to a near 20% annual growth rate. Collier also focuses time and energy on charity work, particularly the Diabetes Research Institute, in honor of his son who lives with the disease. In addition, he puts a priority on recruiting young professionals into the industry. He was RPS’ first-ever Dave McGurn Founders Award recipient, recognizing his 22 years of dedication and overall service to the company.

Browse different topics

Recent Posts